AD',,264 511
PEACETIME INNOVATION AND THEUS ARMY CORPS OF ENGINEERS:
MANAGING TECHNOLOGY FOR INDUSTRIAL APPLICATION
DT|CA Monograph ELEC TE
by MAY 191993
Major Alex C. Dornstauder
Corps of Engineers C
School of Advanced Military StudiesUnited States Army Command and General Staff College
Fort Leavenworth, KansasS~First Term AY 92-93
Approved for Public Release; Distribution s Unlimited
93-11062'92• 5 1S 023"/$1III!I~V!i
MONOGRAPH
PEACETIME INNOVATION AND THE US ARMY CORPS OF ENGINEERS:MANAGING TECHNOLOGY FOR INDUSTRIAL APPLICATION
MAJ ALEX C. DORNSTAUDER, USA
SCHOOL OF ADVANCED MILITARY STUDIESATTN: ATZL-SWZFORT LEAVENWORTH, KANSAS 66027-6900COM (913)684-3437 AUTOVON 552.3437
APPROVED FOR PUBLIC RELEASE; CSTRIBUTION UNLIMITED.
SEE ATTACHED.
TECHNOLOGY CORPS OF ENGINEERS INDUSTRY 79HAZARDOUS WASTE RISK MITIGATION BASE CLOSUREINNOVATION REMEDIATION LIABILITY
UNCLASSIFIED UNCLASSIFIED UNCLASSIFIED UNCLASSIFIED
MANAGING TECHNOLOGY FOR INDUSTRIAL APPLICATION
A Monographby
Major Alex C. Dornstauder
Corps of Engineers
School of Advanced Military StudiesUnited States Army Command and General Staff College
Fort Leavenworth, Kansas
A p o e , Pubirst Rele aseDitrbuionisUnimte
SCHOOL OF ADVANCED MILITARY STUDIES
MONOGRAPH APPROVAL PAGE
Major Alex C. Dornstauder
Title of Monograph: PEACETIME INNOVATION AND THE US ARMYCORPS OF ENGINEERS: MANAGING TECHNOLOGYFOR INDUSTRIAL APPLICATION
Approved by:
Monograph Director
x OZ6 ý/Director, School ofCOL es R. McDonough, M Advanced Military
Studies
__ _ _ _ __ _ _ _ Director, Graduate
Phil Brookes, Ph.D. Advanced MilitaryStudies
Accesion For - -
NTIS CRA&IDITIC TAb j
Accepted this 4Z• day oehu•--1993. _ _
Utstr tbution
Avmld1,fl'tV C(ldes
A ai fdiorF, St4, td_
ABSTRACT
PEACETIME INNOVATION AND THE US ARMY CORPS OF ENGINEERS:MANAGING TECHNOLOGY FOR INDUSTRIAL APPLICATIONby Major Alex C. Dornstauder, USA, 79 pages.
This monograph introduces potential strategic roles for theUS Army Corps of Engineers in the development of technologyfor industrial applications. Specifically, the market forremediation of hazardous wastes at sites in the UnitedStates, both military and private, is explored. Theinnovation environment, that is, the quantity and lethalityof hazardous wastes at military sites is introduced tohighlight its efficacy in developing high risk, high payoffremediation techrhologies. A number of remediationtechnologies are also introduced along with their relativeprogress towards industrial application. The primaryconclusion is that the US Army Corps of Engineters caneffectively and more efficiently bring new remediationtechnologies to private industry than private industryitself. This would be done by using the corps' organicconstruction management assets at contaminated militarysites in a test bed or incubator fashion to hedge highmarket risk and post-project liability.
TABLE OF CONTENTS
I. INTRODUCTION ............ ................... 1
II. ENVIRONMENT OF INNOVATION .......... ............ 10
III. REMEDIATION TECHNOLOGIES ........ ............ 20
IV. CONCLUSIONS AND IMPLICATIONS ...... .......... 26
Appendix A: DEFINITIONS ........ .............. 40
Appendix B: GLOSSARY ............ ................ 47
Appendix C: STRATEGIC MARKET ANALYSIS ... ....... .. 50
Appendix D: FURTHER RESEARCH REQUIRED ... ....... .. 60
ENDNOTES ................ ...................... 67
BIBLIOGRAPHY .............. .................... 74
I. INTRODUCTION
Peacetime . . innovation, is concerned with socialinnovation, with changing the way men and women inorganizations behave . . It introduces a new set of domesticactors, scientists, into the community within which militarydecisions are made. In short, technological innovation givesrise to an additional set of questions beyond those associatedwith organizational innovation.'
The purpose of this monograph is to investigate the
feasibility of employing the US Army Corps of Engineers to
foster peacetime technological innovation for hazardous
waste remediation. Specifically, employing the Corps in a
government-industry team for the public-private transfer of
technology for industrial application. To this end, this
monograph is zouched in the proposition that our nation has
xio viable technology strategy, or policy, where both
government and industry work in harmony toward a specific
end. 2 The argument will be presented by 1) describing the
problem of inhibited technological innovation in hazardous
waste remediation; 2) identifying a potential role for the
US Army Corps of Engineers the government's construction
agent; and 3) proposing a value-added scheme for the US Army
Corps of as a strategic player in this market. The topics
of technological innovation and hazardous waste remediation
remain both timely and germane to the United States Armed
Forces and suggest a potential crossover from a peacetime to
a wartime, tactical environment. As DoD scales down
1
operations, base closure and cleanup of hazardous wastes
have become crucial issues. Remediation of contaminants at
these sites must be accomplished in a timely and cost
effective manner. Private construction industry experience
in this area indicates the need for new and improved cleanup
technologies4 However, the specters of future liability
and litigation have seriously hindered efforts toward this
end.5 Employing the US Army Corps of Engineers in a
strategic role of managing technological innovation here
will help to solve this national dilemma.
PROBLEM STATEMENT
Stephen Peter Rosen, in his book Winning the Next War:
Innovation and the Modern Military, commented on the study
of technological innovation in the nonmilitary world:
The study of technological innovation in the government andbusiness world . . . . has not proceeded so far as to provideany clear - cut models for the study of technologicalinnovation in the military. 6
This is a significant proposition, for it asserts that the
dogmatic emphasis and romance the United States Armed Forces
places on developing and using the latest technologies is
proceeding randomly, emotionally and, consequently, less
than optimally. If our military is to be the standard
bearer of technological superiority, then we must understand
the underlying mechanisms and subtle forces which drive, and
2
inhibit, its achievement. An understanding of peacetime
technological innovation is a step in the right direction.
Determining whether the US Army Corps of Engineers can be
the agent of change in such a model would be an even greater
step towards understanding the roles and missions necessary
for defining innovative success.
RESEARCH QUESTION
Can the US Army Corps of Engineers foster peacetime
technological innovation for transfer to the private
hazardous waste remediation industry? The word foster (to
cause to progress or proceed towards a goal) is used
intentionally to highlight the fielding of new technologies
specifically for private sector application. It is used so
as not to imply the Corps is developing new Lechnologies, or
methods for implementing them, on its own. Related
questions include: Why the Corps, and not other agencies or
industries, should take the lead in developing these
technologies? How can the Corps play an important role in
this area? Should they? Why do firms innovate? Why not? and
If innovation is necessary, can the Corps accelerate it?
The issues of efficiency, that is, can the Ccrps do better
(with a greater benefit-to-cost ratio) than other public
agencies or private concerns, though critical to developing
3
an Army technology strategy, are beyond the scope of this
monograph.
HYPOTHESIS
The US Army Corps of Engineers is uniquely capable to
lead peacetime technological innovation for the private
hazardous waste remediation industry. If the US Army Corps
of Engineers assumes the role of "test bed" or "incubator"
at military hazardous waste sites, then innovative
remediation technologies will be developed and privatized
more quickly and cost effectively.
As the Nation's Engineer7, the corps is capable of
providing technically and scientifically feasible
alternatives, but most importantly, with the management
vehicle to see them through. It is a stable, government
organization capable of bearing significant financial and
operating risk.
This monograph is a call for employing the US Army
Corps of Engineers to foster innovative hazardous waste
remediation technologies and construction management
programs. The central thought is that these technologies
and critical rianagement programs, once developed in a
relatively low risk8 environment at military installations,
would be directly transferable to the private sector for
4
cleanup of Superfund and RCRA sites. As a result, our
domestic technology base and pool of responsible
construction contractors would be strengthened, bols' •ring
our Nation's competitiveness in this burgeoning global
industry. 9
Remediation of hazardous chemical wastes sites is an
inherently uncertain proposition. Private entrepreneurial
investment in such an endeavor is at a considerable cost
premium and requires substantial short-term return on
investment. Exposure to potential litigation makes such
ventures nearly impossible. Small contractors attempting to
penetrate the market with innovative remediation processes
cannot secure bid or performance bonding. Larger firms with
proven technologies yet deep pockets cannot justify the
risks with expected returns." Without some sort of
subsidy, the market tends to force new players from the
scene, implicitly proi.oting more conservative technologies
and remediation processes, ultimately encouraging overall
inefficiency. As subsequent discussion will show, it is
here the corps can serve as a test bed or incubator for
technological innovation"•, leading to a more dynamic
privatization of the remediation process. Using alternative
procurement mechanisms, such as design-build2 or other
turnkeya approaches (both of which involve intense
5
government-contractor coordination and reduced contract
duration), these market risks can be reduced. Pursuing
traditional competitively bid contracts for innovative
projects, the Corps could hold contractors liable only to
the limits of the contract, not to the standards of
processes yet to be developed. In this way, contractors are
de facto indemnified if a new remediation technology is a
loser with the Corps assuming the ex post facto
responsibility. Ir this way, the technology itself is at
risk, not the contractor. Such a method delivers the needed
subsidy in the form of risk attenuation resulting in
correspondingly lower costs of capital, bid bonding, and
performance insurance for prospective contractors. Overall
contract costs are lower with, in the case of alternative
procurement mechanisms, constructability" and biddability'5
engineered directly into the design making the final product
more technically and financially sound. Innovative
technologies for hazardous waste remediation brought more
quickly to the market, at a lower cost, provide more and
better information for our national policy makers and
scientists, increasing our nation's competitiveness abroad,
ensuring a better hold on our commitment to the environment
and national security.
6
ASSUMPTIONS
Underlying this hypothesis are the assumptions that 1)
new and innovative remediation technologies are necessary
for more complete and timely remediation of hazardous waste
sites"b and 2) that cleaning contaminated sites (both
civilian and military) will continue to be a national
priority and legislative mandate, especially under our
future Democratic administration."7 These two assumptions
are based on present practices (EPA and the Corps) of
prioritizing sites by level of contamination and assigning
remediation urgency in a "worst first" fashion."' In other
words, we are working from dirtiest site to cleanest site.
In this way, we eliminate the greatest dangers first and
attend to lesser threats as time and resources permit.
Logically, as the number of available remediation
technologies grows, the more effectively this policy will
proceed. However, contamination is a dynamic problem and
lesser threats become exacerbated if left unremedied.
Consequently, alternative assignment strategies of
remediation urgency are also of import.' 9 It is here that
the Corps can contribute most by managing the development of
remediation technology innovation through DoD programs at
contaminated military installations.
7
MONOGRAPH STRUCTURE
The next section of this monograph, ENVIRONMENT OF
INNOVATION, addresses the background and significance of
this problem by describing the risks and responsibilities
associated with military hazardous waste remediation. The
REMEDIATION TECHNOLOGIES section introduces the actual
technologies for use at contaminated sites and describes
where and when each is appropriate. Appendix C, STRATEGIC
MARKET ANALYSIS, to this section is based upon Michael E.
Porter's Value-Added Chain in Competitive Advantage (New
York: The Free Press, 1985) and presents a strategic market
analysis of the hazardous waste remediation industry to help
evaluate potential roles for the Corps in peacetime
technological innovation. The CONCLUSIONS/IMPLICATIONS
section states specifically why the Corps should be employed
to foster innovation concerning hazardous waste remediation
technologies and thus potential crossover insights toward
the application of innovation in the tactical realm. It
synthesizes the preceding discussions and restates the
central thought of the monograph, focusing specifically on
our military environmental programs as a vehicle for the
Corps in managing peacetime technological innovation and
fostering private sector development. Appendix A presents
definitions of commonly used terms. Appendix B is a
8
glossary of acronyms. Appendix D offers suggestions for
further research in this most important and sensitive area.
9
II. ENVIRONMENT OF INNOVATION
Because the service is a political community, innovation doesnot simply involve the transfer of resources from one group toanother. It requires an 'ideological' struggle that redefinesthe values that legitimate the activities of the citizens .
E [However], without the development of new critical tasks,'ideological' innovations remain abstract and may not affectthe way the organization actually behaves. 20
RXSK
With the possible exception of the former Soviet
military, the United States armed forces is arguably the
most indiscriminate and irresponsible polluters on earth.
In the interests of national security, we deposit thousands
of tons of hazardous materials into the environment each
year, both on federally owned reservations and private
property. Much about these wastes, and the problems they
cause, is already known. However, discovery of contaminated
"hot spots" is not by any measure complete.
MAGNITUDE OF THE PROBLEM
The Defense Department (DoD) is a major producer of
hazardous waste. DoD generates over 400,000 tons each year
from industrial processes, primarily used to repair and
maintain weapons systems, such as F-16 Aircraft, and
equipment (trucks). DoD data show that in 1986 the Air
Force, the Army, and the Navy generated about 96,000,
139,000, and 183,000 tons, respectively, uf hazardous
waste. 21
10
Virtually every major military installation in the US,
as well as numerous minor facilities and former bases, has
caused extensive environmental damage. And the extent of
this toxic legacy continues to grow. DoD owns 3,874
properties in the US and its territories, including 871
major military installations. As of September 30, 1986, the
DoD had identified 3,526 "potentially contaminated" sites at
529 locations. Six years later, the total now stands at
over 17,000 sites at 1,579 locations .2 '2 3 Additionally, more
than 1,200 public and private properties around the US are
currently listed, or are proposed for listing on the EPA
Superfund National Priorities List or NPL. 24 The Pentagon
is a Potentially Responsible Party (PRP) at 53 of the
privately owned NPL sites, including dumps, properties
formerly owned by the military, and contractor owned weapons
plants*25
The number of facilities identified as having
contamination problems is expected to level off soon, since
the armed forces have surveyed most of their facilities. 26
However, as the discovery of new sites continues to be a
major task, this assertion may have little merit.
Additionally, degradation of currently identified sites will
continue to confound remediation, cleanup, and base closure
efforts as long as quick and decisive actions are delayed
11
with procedural questions. Considering the size and
complexity of the effort required for comprehensive
remediation at these sites, managing technological
innovation toward this end state is critical.
TYPE OF TOXICS
The military chemicals which permeate our environment
include industrial solvents, paints and dyes, fuels and
propellants, acids, pesticides, herbicides (containing
dioxins), heavy metals, PCBs, photographic chemicals,
refrigerants, asbestos, cyanide, and medical wastes ...
nerve gas and unexploded artillery shells ... (and) combined
radioactive and toxic wastes. 2"
The toxicity of most military hazardous wastes is not
materially different from their civilian counterparts. In
fact, there does not appear to be any evidence that the
majority of military toxics pose a greater threat,
chemically, than those found at private sites. It is
secrecy and noncompliance with reporting requirements that
cause dangers to human health and surrounding ecosystems
when remediation efforts are confounded. 28
Military specific wastes (chemical munitions and
unexploded ordnance) do, however, pose special threats to
the environment and public safety. The immediate danger of
explosion or lethal release during removal and remediation
12
being the primary concerns. Further contamination through
decomposition and leaching, much like heavy metals at
industrial sites, is also a significant problem. This is
especially true considering the size and number of active
and abandoned training installations where indirect fire
(artillery shells) have impacted and remain unexploded.
ENVIRONMENTAL IMPACT
As with contaminants at civilian sites,
intercompartmental 29 migration (that is, between various
media, such as between soil and groundwater) is a concern at
DoD installations. Groundwater contamination and
volatilization of toxics are only two of the many mechanisms
which facilitate migration between t.ese environmental
compartments. Military toxics, though not significantly
different with regard to their migratory nature, also
contaminate surrounding ecosystems beyond the borders of DoD
installations.
Migration pathways of contaminants do not recognize the
sanctity of political boundaries nor the limits of military
reservations. Not only are service members and their
families at risk. Bordering communities and activities are
also impacted when toxics contaminate drinking water
supplies and the surrounding air. Considering the number
and size of sites worldwide, that impact is substantial.
13
However, it is only now beginning to be addressed by
Pentagon officials. 3"
Remedial inaction also exacerbates environmental
problems at military hazardous wastes sites. Not unlike
their civilian counterparts, military cleanup efforts are
delayed for numerous reasons, budgetary shortfalls and
national security the most noteworthy. These delays amplify
the problems caused when contaminants migrate and spread by
way of geologic and intercompartmental pathways to
neighboring population centers. The environmental
opportunity costs of delayed responses are significant and
speak for a revised approach, focused on action and
remediation.
RESPONSIBILITY
MILITARY ENVIRONMENTAL PROGRAMS
It is clear that our military's past environmental
practices have been negligent and reckless. Yet current DoD
waste management practices continue to jeopardize the
environment. 3" Recognizing this, the Congress enacted the
Defense Environmental Restoration Act in 1986 which mandated
that DoD establish the Defense Environmental Restoration
Program (DERP). This is the DoD level response to
contaminants generated by military commands and is the
14
authority from which all other military environmental
response programs spring. Each of our services has since
established their own environmental restoration programs.
The following discussion will concentrate on those effected
by the Department of the Army (DA).
The Installation Restoration Program (IRP) is the DA
plan for cleanup of its contaminated sites. It is a
comprehensive and innovative effort by which DA will meet
the standards and requirements of the DERP. Included in
this are contracting mechanisms, public participation
requirements, and directions for interagency coordination
agreements with EPA, and state and local governments. The
plan is published by the US Army Toxic and Hazardous
Materials Agency, an arm of the Corps of Engineers. Action
responsibility for the success of the program is delegated
to the installation engineer or DEH (Directorate of
Engineering and Housing).32
The Formerly Used Defense Sites (FUDS) program is DA's
equivalent to the Superfund. The purpose of this program
is, as its name implies, to cleanup formerly used defense
sites which are now either inactive or abandoned. Sites can
be located on federal or private property with one or more
responsible parties, that is, DoD and its contractors. The
15
US Army Corps of Engineers is the executive agency
responsible for this program.
The Integrated Hazardous Material/Hazardous Waste
(HM/HW) Management Plan, now in its formative stages, is a
draft program by which DA will reduce its hazardous waste
generation by 50%, compared to its 1984 levels, prior to the
end of fiscal year 1992. This waste minimization effort, as
mandated by the Congress in the 1986 Defense Environmental
Restoration Act and DoD in the DERP, is an attempt to bind
DA agencies together through standardized reporting and
monitoring procedures. As an action plan, it assigns
responsibilities and timetables for completion of critical
actions to specific DA agencies and major commands.
ASSESSMENT OF THE PROGRAM
As an instance of programmatic innovation, the DERP's
strength lies in its action orientation. It directs the
United States Armed Forces to produce measurable results in
helping to mitigate the impacts of day-to-day operations.
This is not a significant departure from similar civilian
programs. However, the organization within which action
will be carried out is--DoD is results oriented and task
organized. The military's default setting is "action
instead of deliberation" and "forgiveness rather than
permission". This is probably the single most significant
16
distinction between remediation efforts at civilian sites
and "military" installations.
However, DoD's program is beset with many weaknesses,
some of which could compromise the entire defense
environmental effort. First and foremost of these is
inadequate coordination and centralized management of the
services' environmental programs.
Lacking zhe guidance and unifying force behind ... reportingrequirement(s), there has been no unified reporting ofmilitary toxic releases. Ir.stead, regulators and the publichave been presented with Pentagon waste generation figuresthat are more like "guestimates" than hard numbers that such aserious issue demands."
The principle reason for this shortfall is a lack of
centralized control at DoD. Reporting procedures are
different within and across the several services, with no
standard binding their efforts together. The DERP does not
provide specific enough guidance to solve this problem. The
result- DOD does not know Lhe magnitude, toxicity, nor
*iigration destinations of its ha,:ardous wastes. This
uncertainty impedes efficient cleanup efforts and
programming of limited environmental dollars.
Another significant shortfall is in the legal arena.
The principle of "sovereign immunity""4 and the "unitary
theory cf the executive"35 preclude prosecution of DoD by
stakeholders (individuals and private concerns) and
17
executive agencies. The Justice Department contends that
Federal Agencies are exempt from state (and local)
enforcement under the doctrine of "sovereign immunity" and
has refused to bring enforcement suits (on behalf of the
EPA) against DoD, claiming that the "unitary theory of the
executive" precludes one agency of the executive branch
(EPA) from suing another (DoD) .36 The practical result of
these views is that there is no downside risk for the
Defense Department in this very sensitive area. Without the
specter of liability from litigation, a major force in the
civilian environmental market, DoD can set its own agenda
concerning site remediation, cleanup, and closure. In these
times of budgetary constraints, fiscal crisis, and military
cutbacks, limited resources are understandably directed at
mission essential tasks and away from the DERP. The result:
sites remain contaminated, contaminants continue to migrate
off-site, and stakeholders have no legal mechanism through
which they can influence the cause of the problem.
Our military's environmental record is less than
sterling. Past practices and environmental ignorance have
caused significant ecological harm and continue to pose
risks to human health. Present DoD programs, though based
in an action organization which speaks well for remediation
and process innovation, fall short of providing the
18
information and opportunities necessary for credible
management of this critical problem. Consequently, the need
for a lead agency, such as the Corps, in managing this
technological innovation is key.
19
III. REMEDIATION TECHNOLOGIES
farsighted peacetime military innovation has bee..possible in the American military, even during the 1920s and1930s when military budgets were tight and popular attitudestoward the military were far from friendly, and even in the1950s, when the military bureaucracy had swollen in size farbeyond prewar levels". . Study of the changes in theeconomic, political, or technological realms that were beyondthe control of governments and that constituted theenvironment with which military organizations had to contendcould provide a more stable basis for deciding whethermilitary innovation was necessary and what its character mightbe. 36
As Rosen suggests, innovation is possible in the most
hostile of peacetime environments. Moreover, for military
organizations to continue to be viable means to political
ends, innovation must occur. This innovation based,
however, upon a knowledge of the underlying strategic
environment and a model of the forces which drive innovation
in general. To this end, our center of gravity with regard
waste remediation is the base of technologies presented
here. However, our operational center of gravity in the
more holistic domain of technological-tactical crossover, is
cybernetic, that is, the management of these technologies
toward that strategic political objective. This is the
value-added innovation role of the US Army Corps of
Engineers; to innovate by creatively combining and managing
remediation technologies for optimum result.
Hazardous Waste Remediation, or "end-of-pipe" cleanup,
is generally accomplished by using one or more of three (3)
20
types of systems: I) in situ, 2) prepared bed, and 3)
in-tank reactor. In situ systems involve treating
contaminated soils in-place, that is, where the
contamination is located; contaminated soil is not moved
from the ground. Prepared bed systems involve either i) the
physical removal cf contaminated soil from its original site
to a newly prepared area which has been designed to enhance
treatment and/or prevent transport of contaminants from the
site, or 2) movement of contaminated soil from the site to a
storage area while the original location is prepared for
use, after which the soil is returned to the b~d, where
treatment is accomplished. In tank systems involve removal
of contaminated soil for treatment in an enclosed reactor
based upon batch, complete mix, or plug flow systems."9
These three (3) systems employ one or more of several
treatment technology classes: 1) biological, 2) chemical, 3)
physical separation (component and phase), 4) stabilization,
solidification, encapsulation, and 5) thermal.
Biologicalo treatment (Table 1) involves employing
bacteria, fungi, and/or microorganisms to alter or destroy
the hazardous waste. Liquid and solid wastes that can be
treated by this method may include toxic chlorinated and
aromatic organic compounds. The process is highly sensitive
to environmental conditions, including fluctuations in pH
21
and temperature, and to changes in the concentrations of
heavy metals and salts in the waste stream.
Chemical4' treatment (Table 2) of hazardous waste is
accomplished through a chemical reaction in order to destroy
the hazardous component. Wastes that can be treated by this
method include both organic and inorganic compounds without
heavy metals. Drawbacks to this method include the
inhibition of the treatment process reaction by impurities
in the waste and the potential generation of hazardous
byproducts.
A physical 42 treatment (Tables 3 and 4) separates the
hazardous waste from its carrier by various physical methods
such as adsorption, distillation, and filtration. This
class of treatment is applicable to a wide variety of wastes
but further treatment is usually required.
Stabilization, Solidification, and Encapsulation43
processes (Table 5) isolate wastes from the surrounding
environment without destroying their hazardous constituents.
The treatment objcztive is normally achieved by mixing the
waste with an inorganic compound such as fly ash, lime,
clay, or Portland cement to form a chemically and
mechanically stable solid. The treated waste generally has
higher strength, lower permeability, and lower leachability
22
than the untreated waste. This treatment class is
applicable primarily to inorganic wastes containing heavy
metals. Organic compounds often interfere with the setting
action of the solidifying agent. There is no guarantee of
the effectiveness of this method over time due to a lack of
data on long term leachability studies. This type of
treatment may be feasible for use at sites with limited
space or in emergency actions to alter the form of the waste
to a more easily transportable form.
Thermal" treatment (Table 6) involves the decomposition
of waste by thermal means into less hazardous or
nonhazardous components. When subjected to high
temperatures (2500-3000*F), organic wastes decompose to
similar, less toxic forms. Complete combustion yields
carbon dioxide and water plus small amounts of carbon
monoxide, nitrous oxides, and chlorine and bromine acid
gases. Some thermal processes produce "off gases" and ash
that require further treatment or landfill disposal. This
treatment class is most suitable for organic wastes and is
less effective when attempting to detoxify heavy metals and
inorganic compounds. Thermal treatment is often very
expensive.
Treatment technologies and systems may be combined to
form chemical- and site-specific treatment trains, which can
23
be selected to address specific waste escape pathways and
phases during remediation. Evaluation for each possible
combination of technologies and systems is based on a
chemical mass balance approach through time to identify the
fate of each waste. However, the lack of approaches for
this sort of evaluation remains a current, major deficiency
in the area of subsurface remediation, including soil
remediation. In fact, two major problems with regard to
meeting soil remediation requirements have been 1) lack of
availability of appropriate technologies, and 2) lack of
methods and approaches for evaluating and selecting remedial
technologies for specific site-waste scenarios, especially
with regard to in situ remediation.' 5
Alternative technologies for each of the five (5)
treatment classes are presented in Tables 1 through 6.
Applicable waste types, practical limitations, and special
use considerations are also included. The development phases
described for each technology are as follows: A=Available
Alternative Technology indicates that a technology is fully
proven and in routine commercial or private use;
Z=Innovative Alternative Technology describes a technology
for which cost or performance information is incomplete,
thus hindering routine use at hazardous waste sites (An
innovative Alternative Technology requires full-scale field
24
testing before it is considered proven and available for
routine use); E=Emerging Alternative Technology signifies
that the technology has not yet successfully passed
laboratory or pilot-scale testing. 46
25
TECHNOLOGY APPLICABLE CONTAMINANTS QUALIFYING FACTOIRS PHA MOO
Aettiated Sludge soluble organics in Gilute aqueous streams * BOO <11,000 ppm., A x(<Il% suspended solids) *Requires low conicurrations of heavy
metals, PC8, pesticides oil, and grease
Amble Trostmentir Aqueous waste with low levals of *am <10,000 ppm. A X(Sequential batch reactor. nonhalogenated organricis and canain *1Requires consistent. stable operatingtliudized beda fixed film halogenatled organics (that is, phenols conditkfluidized bed with Iwithtouil formaldehyd. PCP).activated carbon, aeratled6044iim reactor, membranereactor)
Anwserblo Treatment Aqueous slurry with low to moderate Wvskl of - Rquiresi consistent. stable operating A(1 luidirzed bed. fixed film nonchlcilnated organic compounds containing conditions.fluidized bed with Iwithout <7% solids. *Unsuitable lor o4l and grae aronwacs.act~ivaed carbion). adln hi yrcros
aectmis PC8s and various O~the organic compounds in -May invoiwi geeic enginerimng. A xsoils (that is. Z4,5-T and Z.4-0). ,Natural adaptation.
Comnpoeting Aqueous sludge with cf50% solids, "Requires nutrient supownementsons. AnOnchiornated hydrocarbtons, high organric - Output sludge contains heavy metals.wastes including oils, tars, and industrialProcessing sludges
Enxyme Treament Solbl organics in dlufeaquou wade * Rwuas stable influen concentration. E xstreams.
aaon nd Poind. Industrial wastewater. organics with slow Requires large area& Abiodegradation poential, soluble, organics in ' Unsuitable for solids.dilute aqueous waste stream&. *Requires temperate dlimate.
'Output sludge contains heavy metals andretraclory organ"c which require furthertReatmen.
&fy~orvhlzs SoW - entrained hazardous waste constituents. E X
Rotatng Slologioel Biodegradable dilute aqueous organic waste 'Limited to low concentrations of heavy A XCantactor including solvents and halogenated organic& mealas and concentr'ated refractory organics.
, Unsuitable for sludges or solids.
TrIoklng Filteir soluble organics in dilute aqueous streams with * BOO <5.000 ppm. A X01% suspended solids including solvents and -output sludge contains heavy metals andlhalogenated organics. refractory orgarics which require turther
treatmrent.
White "~ Fugue Toxic or refractory halogenated organics in sal E X(RPhnerxhmte (that is, 2,31.7,8-TOD, DDT, mires, irdafle,cit ospjr) hexachlorobenzene).
Yeast Strain. Halognated organics. -involves genetic engineering. E X
PHA - Phase of Development: A = Available, I =Innovative, E Emerging
MOB (MOBILE) - Transportable
Table 1.Biological Treatment Technologies.
TECHNOLOGY APPLICABLE CONTAMINANTS QUALIFYING FACTORS PHtA WOB
ChWNWn.Iy. Concentrated liquid chlorinated organic wadte *Utnsuitable for solids and lams Istreams with low concentrations of sulfur and * Unsuitable Wo benzene and aromatics.oxygen, OutpN carbon telrachioride can oe
recovered.
Oehial~genatlo Halogenated organtics in soids and sludges that -%equires Yat and eXCess reagent I X(includling use of the Ajkai are partially derrtidrated (that is, PC8s. dioxins).Metal Polyethylene GlycolReagent - APEGý
1146111roheomIaI tialogenaled organics (that a. PC~s). Nol krnown.
Elleatvoeya Oidlaltion High concentration cyanide (10%) and metals *Suitable for low solid content waste&. Awaste&.
Hydro"yae Solids soils, sludges, slurres, or liquids * Requires Careful handling of strong acids A Xcontaminated with organic compounds. and atlkajines.
-Reaction is performed at high tempereaturesand pressure requiring close monitoring.
Ion Exchangle Aqueous organic or inoranid wade streams. * Suitable for liquid wagte only. A X
principally metals.
Lignin Adecption Aqueous organic or inorganic waste streams. *Not M~own. E X
Neutbellisetlon Corrosive liquid wastes. both acids and bases. * Unsuitable tor sludges and solids. A X,Requires corrosion resistant equipment.
OxIdetkio Dilute aqueous waste (<I% waste) conitaining * Requires controted reaction conditions. A X(chlorination, ozonation, organic I inorganic compounds. *Suaitale for liquxis and sludges only.hydrogen perOXKde, pota--npermangainate, chlornredioA4e. hypochlorites).
Pofmew Atilon Organic compounds such as aromatics. aliphatics. *Applicallon islimited to spils. I Xand oxygenated monomers.
Precipillation Aqueous organic and inorganlic waste containing * Requires optimization of the reaction pH to A Xmetal&. the specific mix of metals present.
'Outpis sludge requires further treatment.-Cross -reactivity may occur bor muled
metals content waste., Unsugable tor sludges. tars, and slurries.
Reduot~in Otute aqueous waste stream containing inorganic - Applicable to inorganic waste only. I X(Sulfur dioxide, sodium compounds. especially metals (< 1 % heavy metal - suitable tor liquid waste only,borohydride sultile salts, concentration).ruthenium tetraoxide).
UVY / Ptsotolysle Liquid waste containing dioxins. - Suitable for liquid wastes only. E X
PHA - Phase of Development: A =Available, I = Innovative, E = EmergingMOB (MOBILE) - Transportable
Table 2.Chemical Treatment Technologies.
TECHNOLOGY APPLICABLE CONTAMINANTS QUALIFYING FACTORS Pj AMOO'
Air Flotation Liquid waste containing oils or iighi sSsPended *Liquid elffluent may require furrner A(dwfvecl or induced) solid&. treatment.
Comiintugation Organic/Iinorganic liquds. siurnies and sludges * UnSugaab* for ?ars soidos. dry powoers, of A X(bowl, bsiet, disk), containing suspended or disofved solids or gases
liquids where one component S nonvolatile. For * Not apolicaoile for smarl size or Kyw asensityexample, wastewater sludge, wastes containing parlicles.immeiscible liquids, or wastes containing three (3)distinct phlase&.
FILTRATION:
Bak Fiterts Pi.. 5dogical and industrial sludges. - Filner catka may require tunhier treament. A x
Chamber Pr.esure Wastewater sludges, or sludges with a flocculaled: Dewaenerng technology. A xFiltration or adhesive nature, * Unsuiabl for sticky or gelatinous sludges(pressure leaf tube elemtent,plate and traime. horizotalplate)
Granular Media Liqluid waste containing suspended solids and /or - Requires frequenit Dac~washing. A XFiltration oils. * Requires prtareatment for suspended soedsa
with concentration .000 mg/f.
Vaoilum Filtration Origaicrii or inorganic chemical sludges, metals, , Dewateuing technology. A X(fixed media, rolary drum) and cyanides bound up in hrydroxide sludges. Unsuitable for sticky or gelatinous sludges.
Gravity Separation Liquid waste containing settleable suspended -Liquid effluent may require further A x(coagulation, tlocculation, solids, oils, and/ior grease. treatmentsedimentatkon) *Unswiable for heavy slurries. sludges, or
tams
In Shtu Soil Extraotlont Soils with low Weels; of organics or inorganics/ Unsuitable tor dry or organic -rich soils E Xmetal contamination.
PHA - Phase of Development: A = Available, I = Innovative, E =Emerging
MOB (MOBILE) - Transporttable
Table 3.Physical Treatment Technologies
(Component Separation).
TECHNOLOGY APPLICABLE CONTAMINANTS QUALIFYING FACTORS PHtA MOD
Air Stuipping Aqueous and adsorbed organic and inorganic *Limited to VOC concentration < W0 ppm. A Xwastes with relat~vely high volatlilty and low water SusPended solids may clog lowrsolubiliy such as chlorinated organics, aromatics.and ammonia.
Carbon Adeomptlion Aqueous organic wastes (corttainng < 1% total *Unauitable for metals. A Xorganics and <60 ppm solids) with high -Unsuitable for oil and grease.molecular weight and boilng po"nt and low watersoluilitiy, polarity, and lovaizaon.
Colloidal Ga. Apisron., Soils contaminated with phenols, phihalate esters, Hydraulk conductivity of the soil must be E X(CGAe) aromatic hydrocarbonis, aliphalic hydrocarbons, > 1W cmisse.(enhances sir stripping and chlbrfnaled hydrocarbons, amines, and alcohols.biodegradalion)ý
Distllation Liquid organic mixtures with lo viscosity that -Unsuitable for thick polymeric mateirials, A Xcan be separated due to molecular weightl slurries, sliudges, or tars.volatiliy differences.
EleatroIdnetlo. Soil contaminated with organic or inorganic - Soil matrix must be relativelly permeable Iwadse. ark' saturated.
Evaporation Organic I inorganic liquid solvents contaminated - Liquids must bue voilatile. E Xwith nonvolatile impurities (that is, oils, grease, * Unsuitable for tars solids, dry powders, orpaintf solvents, polmei resins). gases.
-Energy -intensive process.
Freeze Crystallization Dilute aqueous organiclinorganic waste solutions "Unsuitable for foamyr1, viscous or high solid E Kcontaining < 10% tWta dissolved solis Conen waste streas.
Meohaniloall Sail Aerationi Volatile organics in sludge and soil. Elfluenf may require f urther treatment. A X
Metal Binding Metal - contaminated aqueous streams, leachate. * Limited to metal concentrations between Eor groundwater. 500- 1000 porn.
Resin Adsorption Aqueous waste streams containing soluble " Limited to low concentrations of organics Aorganics, particularly phienols and explosive (<8%) and suspended solids (<50 ppm).materials.
Revue.s Osmosise Aqueous waste streams containing <400 porn -Unsuitable tor oxidarim. I Xheavy metals, high molecular weight organics. -Requires controlled pH., low concentration ofand dissolved gases. suspended solis.
Solventl Extraotlion Aqueous stream contaminated with single- or -Extracting solvent must be imnmiscible in the A, I Kmulti -componentl dissolved organic wastes. liquid and differ in density so gravitySludge contaminated with oi lstoxic organics and separation is possible.heavy metals. *Suitable for sledges containing < 20 wt
ol Ilorganics and < 20 wt % solids
S1tearn S1tripping Aqueous; solutions of volatile organics *Effluent may require further treatment. A K-Suitable lfo waste streams with low metalConcentration.
Supaeewrfts!a Extraction Sludge, solids, or liquids contaminated with Effuent may require further treatment. a Xorganics.
U.11ttafiftration Removes oils, metals, and proteins from aqueous * Limited to low concentrations of suspendedsolutlons with dissolved organics, emulsions, and Solidscolloidal particles
PHA - Phase of Development: A =Available, I = Innovative, E = EmergingMOB (MOBILE) - Transportable
Table 4.Physical Treatment Technologies
(Phase Separation)
TECHNOLOGY APPLICABLE CONJTAL41NANTS QUAILIFYING FACTORS PH4A MOB
Comnwin - based Fixation Treated sludges and soiis containing metal -Long term stability Ieachablk~y is Lnknowri. A Xcaliors, radioadirve wastes, and solid - Lignite, silt, and clay increase selingj time.organics (that is plastics, resins, tars). * Oissolved sultate salls, borates, and arsenates must
be limited,
Ma.,..o Enoapoulatian, Chemically or mechanically stabilized -Encapsulating matrix must be comtoaible with A XOvoqm.I'ng, organic, inorganic, and radioactiiii waste& wadst.Thonnoplatatie nd -Long term Iteachabtity unknown. theretore, wasgeThn-wuseatin storage must becnsdrdTehinluiques * Requires soecialiZed equipment.
113,011:0a1111 - based Treated sludges and soils containing - Borates, sulfates, and carboydrates interfere with A XF11xat*1101111 heavy metals, waste oils. solvents, and the process.(fly ask, Ume based) low level radioactive waste. Long term stability / leachability is unknown.
S.rptlVo Clayte tisigenated organic compounds and - Long term leaching is a prottemt. therefore, waste I X(treated. chemnicalty modtifid) heavy melals. storage must be considlered.
V111:101i1111110 Soils contaminated with organic. inorganic, - Limited to soils with high silica content- A, I Xand radioactive wastes.
PHA - Phtase of Development; A = Available, I = Innovative, E = EmergingMOB (MOBILE) - Transportable
Table S.Stabilization, Solidification, and
Encapsulation Treatment Technologies.
TECHNOLOGY APPLICABLE CONTAMINANTS QUALIFYING FACTORS PHtA IMOOElectric Rectoir S04l contarimnated with solid and liquid - Contaminated soil must os finely orvdea and ory, I X
organics and inorganics.
Fixed Hearth Bulky sotids, liquids, and sludges. -Particle size must be iarge enougn not to tail Athrough grate.
Fluidized Bled Organic solids, liquids and sludgei -Requires kmw water and inert solid content. A X
Industrial lollr Granulated solids. liouidls, and sludges. -Requires low chlorine and suitur content. A-Ash content clogs system.*Sii- sml artcesze,
Industrila Kiln Soaent pot lining, nonhalogeaed OiKs arid *Requires low chlorine and sulfur content. APCS - contaminated liquids and sludges.
ntnrarsd Inollneration Soils solids, and Sludges cornlAmhieid * Prmarily tar solid organic waste. A Xwith organic compounds (that is, PC.as, *Heavy metals are not tixed in ash.
-oke WO--
Liquid Injoution Pumpaote liquid organic waste. * Unsuitabk( for inorganic content and heavy metal A Xcontent wwses.
* Chlorinated solvents cause ;ccelerated corrosionrate&.
Molten Gie". Organic solids, liquids, gases, sludges -Sodiumn suffates must be limited to < 1% content. I(that is, plasitcs, Kats, asphalt. - Inappropriate for soils and high ash contentpesticides). waste.
Molten Slalt Low ash content wadst, low water zontentl -Corrosion problems I Xliquid, or solid waste. - Requires trequent bed replacement.
Multiple Hearth Granulated solids, sludges. tair, liquids, - Water, salt, and metal content must be lin, d. Aand gaseous combustible waste. * Paslicle size must be small enough to pass
through injector nozzles,- Not recommended tor hazardous wases.
PhaMa System. Liquid organic wastes (that is, pesticides, , Liqulios only. Xdioxins. PCBs, halogenated organics).
Pure Oxygen Rlume~r Uquid wastes which require high -Requires specially engineered nozzles to atorc ze Xtemperatures for destruction or have low the liquid waste,heating values.
Pyrolyslt Viscotus liquids, sludges solids, high ash * Requires homogeneous waste input. Xcontent materials, salls and metals, and * Meals arid sails in the residue can be leachable.halogenated Waste.
Radlio Frequancy Volatile, low booling point, or easily *Not knowni. I XThewttnal Heating decomposed organic compounds in soil.
Rotar Kiln Solid, licuid, or gaseolus organic waste. * Containerized wastes are dlticutt to handle. A X- High, inorganic salt or heavy metal content wastes
require special consideration.- Fine particulate matter must be P-ilfed.
Superorltloolt wotw Aqueous organic solution islurry of mixed * Not known. IOxidation organic / inorganic waste.
Wet Air Oxtidation Artu-'us waste streams (<5%) with -Unsuitable for solids. viscous iouids, of highly A Xdissolved or suspenued volatile organic halogenated organic compounds.subsances - Not iconomicai tar dilute (y conceritrated waste
PHA - Phase of Oevelopment: A =Available. I =Innovative, E = EmergingMOB (MOBILE) - Transpoftablee
Table 6.Thermal Treatment Technologies.
IV. CONCLUSIONS AND IMPLICATIONS
WORST POLLUTER
As the discovery process continues, more and more
contaminated "hot spots" will be uncovered. The problems
surrounding currently identified sites will continue to
confound decision makers if immediate and effective response
actions are not effected. Cleanup of contaminants from the
past is only part of the solution, however. Process and
program overhaul to effectively monitor and manifest the
disposal of currently generated wastes must be implemented.
Waste minimization strategies, such as those outlined in the
Five-year Integrated Hazardous Material/Hazardous Waste
Management Plan must also be brought to fruition;
end-of-pipe treatments are well known to be mcre expensive
and environmental unsound than process modifications to
reduce waste generation at its sources. Substitution of
less toxic substances in processes is a step in the right
direction.
Scaling down military programs and operations in
recognition of the decreased strategic Soviet threat around
the world is already in the works. From the environmental
standpoint, this could be a boon to the effort of reducing
military environmental destruction. However, it is a
precarious assertion that this alone will allay further
26
damage or even greatly diminish it. DoD must design into
its daily activities a consideration for environmental
matters. Not only must the industrial processes of weapons
and chemicals manufacture be realigned along environmentally
sound lines, so must maintaining the readiness of the force.
Soldiers and sailors must be educated, as should their
civilian counterparts, to respect environmental concerns.
They will use this knowledge as members of our armed forces
to help 7hange its course to a more environmentally
enlightened path. They will also carry this knowledge back
with them when transitioning from military to civilian
careers as their service obligations terminate. Losing this
mechanism for environmental action, both inside and outside
of the military, would be criminal.
MILITARY'S PROGRAM HAS PROBLEMS
The Defense Department's hazardous waste cleanup
programs are beset with problems which, unresolved, will
further hinder efforts towards timely and effective
solutions. Standardized reporting procedures and ingraining
a bone-deep environmental ethic are critical to success. In
addition, the legal issues of "sovereign immunity" and
"ul±itary theory of the executive" must be addressed.
Litigation is not the key, however, as it is, historically,
a stumbling block to swift environmental remedy.
27
Interagency agreements, as outlined in the IRP, may be the
tool through which stakeholder concerns can be equitably
addressed. The critical issue, as with Superfund sites, is
a balance between litigation, regulation, and remedy. The
Superfund program has failed in this regard, placing too
much faith in tort law as the enforcement/compliance
vehicle. DoD is in a unique position to establish such a
balance and, perhaps, develop a model after which other NPL
sites across the country could pattern their remediation
programs.
MILITARY'S PROGRAM MUST BE CREDIBLE
The Defense Department cannot hide behind the veil of
national security in pursuing its environmental end state.
If it is to succeed, it must be considered credible by the
stakeholders involved -- lawmakers, environments" groups,
the scientific community, and local concerned citizens.
This should involve a more participatory approach,
specifically, the Co-production model described by Susskind
and Elliot. 4' Presently, the action for public involvement
is delegated to local commands' Public Affairs Offices. As
a risk mitigation tool, as well as a joint fact-finding and
education vehicle, commanders must further interact with
stakeholders to ensure their support and confidence, up
front. However, public participation and stakeholder
28
involvement should not hinder DoD's environmental response.
Credibility is earned from results and deeds, not rhetoric
and hand waving. DoD has the opportunity to materially
effect the environmental health of t!e nation, in a positive
way, and should realize that all parties' concerns will
necessarily not be satisfied, as they conflict in many
regards. Action, not deliberation, is the key.
Our military's toxic legacy is one of immense
proportions. As bases are closed and the size of the force
is scaled back in response to the decreasing strategic
threat from abroad, "peace dividends" will be targeted at
environmental restoration. Because of its action
orientation and insolation from the liability of litigation,
DoD and the Corps have a unique opportunity to foster
innovation of remediation technologies at contaminated
military sites. Part and parcel to this is developing new
and innovative action programs and technologies for transfer
directly to private sites. As the nation's engineers and
action agent for DA's programs, the US Army Corps of
Engineers can help generate the success stories necessary to
sell the Congress on assigning them the nation's overall
remediation mission. With the "big blip on the screen"
(1995 Superfund Reauthorization) not too far away, this
should be a primary focus for the Corps in the near term.
29
In the long-term, the consideration should shift to
commercialization and practical application of new
remediation technologies and action programs to help bolster
our domestic contractor and technology bases, further
enhancing our competitiveness in global circles.
THE US ARMY CORPS OF ENGINEERS
The US Army Corps of Engineers has a distinct
responsibility and unique aptitude to assume a leadership
role in resolving this environmental dilemma. The Corps has
both the moral and professional responsibility for
providing, at the least, technically and scientifically
feasible alternatives to the Nation. Over a century of
experience in solving tough problems and working with local
governments and the business community speak highly for its
role as an intermediary and coordinator in just such an
effort. In addition, the Corps is a stable, government
organization, capable of bearing significantly more
financial and operating risks than even the largest of
America's corporations. If for no other reason than this,
the Corps is an ideal vehicle for insurance underwriting and
for information gathering at significantly reduced costs.
Both the opportunity costs of inaction and those of
misguided actions can be mitigated in this reduced risk
arena.
30
Achieving goals means applying science to situations
the best way we know - in other words, taking risks.'8 The
Corps' capacity to assume considerable risks in developing
solutions for unique problems is particularly noteworthy
when considering the environment. Remediation of hazardous
chemical wastes and disposal of spent nuclear fuels are
inherently uncertain propositions. Private investment in
any one of these endeavors is at significantly higher cost
and requires equally substantial return on investment. Our
increasingly litigious society makes such ventures nearly
impossible, especially for smaller contractors attempting to
penetrate the market with innovative products or processes.
Without some sort of subsidy, the market will tend to force
new players from the scene and encourage overall
inefficiency. It is here that the Corps can assume a
leadership role in technological innovation and
privatization of remediation processes. Through alternative
procurement mechanisms, such as design-build or other
turnkey approaches, the Corps can mitigate market risks. It
can also pursue traditional competitively bid contracts for
innovative projects, but hold contractors liable only to the
limits of the contract, not to the standards of processes
yet to be developed. In so doing, contractors are de facto
indemnified if a new energy or remediation technology fails
31
with the Corps assuming ex post facto risks of technological
failure. Therefore, the technology is at risk, not the
contractor. Such a method delivers the needed subsidy in
the form of risk mitigation resulting in correspondingly
lower costs of capital, bid bonding, and performance
insurance. Overall contract costs are lower with, in the
case of alternative procurement mechanisms, constructability
engineered directly into the design making the final product
more sound, both technically and financially. Innovative
technologies for hazardous waste remediation brought to the
market at a lower cost and quicker, provide more and better
information to our national policy makers and scientists for
even more informed and legitimate decisions.
As the nation's engineers, the Corps also has a
responsibility for developing new and better technologies to
allay the environmental consequences of industrial
activities. Our new found public awareness concerning the
environment has not yet been translated into remedial action
on a large enough scale to effect real change. Now, more
than ever, engineering skills and tools are needed to
achieve environmental ends." 9 However, engineering is not
simply the technical proposal of new and innovative methods
and mechanisms. Part and parcel to engineering solutions is
economic feasibility. A properly prepared engineering
32
solution is the optimal combination of technical
alternatives and available economic resources. Ultimately,
engineers must present their solutions in a format
acceptable to audiences of diverse political convictions and
scientific aptitudes. This is the forte, and mission, of
the Corps.
Engineering skills and tools are abundant within the
Corps, both at its operating engineering divisions and in
its three (3) central laboratories. Also organic to the
organization are the construction elements of each division
which actually administer contracts around the world. The
synergy of using both to effectively manage the development
of new and better technologies and remediation programs for
our common environmentally safe future is obvious.
Balancing tasks and budgets is a daily function within the
Corps, one which it takes seriously, along with presenting
engineering solutions at public forums, a common part of all
civil works projects. Above and beyond this is the fact
that the Corps is an agent of our government and its
national policies. It has its "finger on the pulse" of
national sentiment and our policy makers' desires, along
with understanding its greater task of maintaining the
Nation's trust. The Corps is central to coordinating the
33
engineering solutions to our environmental problems and
presenting them to our Nation.
RISK MITIGATION
The test bed or incubator concept is, in fact, an
innovative risk mitigation strategy designed to shift the
uncertainty in remediation projects to the party most able
to bear them; in this case, the government. With industry's
emphasis on short-term return on investment and our high
domestic cost of capital, the risks associated with
remediation contracts often make only a very few projects
financially feasible. This is especially true when
conventional contracting mechanisms, such as fixed
price/competitive bid, are employed. Through the use of
alternative contracting methods, or innovative uses of the
conventional ones, the biddability and constructability
risks associated with remediation jobs will be reduced.
Coupled with the test bed concept's long-term focus on
development and commercialization of new processes, the
risks of implementing innovative methods will be shifted
from contractors to the government. This will, in turn,
increase the competitiveness of our domestic contractor base
in the global remediation market.
"TEST BED" OR "INCUBATOR"
34
The magnitude of our military's toxic inventory and the
number of DoD sites presently listed for further remedial
action speak well for using this arena as a test bed or
incubator in developing new and innovative remediation
technologies and administrative procedures. This
simultaneous program of remediation and R&D should be an
explicit DoD policy objective and an integral part of the
DERP and the IRP. Lessons learned from other environmental
programs (Superfund, for example) should be drawn upon in
this regard. Emphasis should be on action rather than study
to mitigate the environmental opportunity costs of a delayed
response, whether caused by the lack of appropriate
technologies or bureaucratic inertia in the name of
scientific deliberation. Newly developed action programs
and remediation technologies could be directly transplanted
to similar civilian sites to help streamline cleanup.
Alternatively, the US Army Corps of Engineers, as the agent
of innovation in the DoD toxic arena, could be given
universal oversight, responsibility, and resources for the
nation's remediation responsibilities.
CONSTRUCTION INDUSTRY POTENTIAL
If the federal government adopts the policy prescribed
above, private industry construction contractors will be
some of the primary beneficiaries. Since the Corps has no
35
organic construction forces properly trained and equipped
for remediation of hazardous waste sites, work will be
performed exclusively by civilian firms. As described in
Appendix D, the market potential for these firms is great.
However, the size of the market is not the only factor to be
considered at this point. Hazardous waste remediation
projects will also help to mitigate the construction
industry's cyclical nature 1y reducing the risks firms face
when bidding contracts in fading conventional markets. With
the protection and encouragement of the federal government,
contractors will develop "field proven" remediation
technologies and construction processes to secure other
cleanup projects, both military and civilian. Combining
these new jobs with others of conventional fare in their
portfolios, firms will effectively diversify their operating
risks. As a result, they will be more able to compete in
global markets where "court ready" remediation technologies
and construction management services are also in high
demand.
NATIONAL TECHNOLOGY STRATEGY
With implementation of the test bed or incubator
concept, DoD will lay the foundation of a national
technology strategy focusing on commercialization of
innovative processes. The intent is to afford construction
36
firms an opportunity to develop, field test, and refine new
remediation technologies for future injection into the
industrial mainstream, while shielded from foreign
competition. Government protection, while these contractors
worked on DoD projects, would amount to a subsidy for
product and process development where firms could, less
expensively, bring new techniques to market and compete on
equal terms with offshor3 companies, especially where large
capital outlays for equipment are required. Cost
engineering will be critical in this regard, as contractors
continue to refine technologies and construction methods to
increase their efficiency and reduce costs. If our firms
attack this market as "first movers", they will surely fall
prey to "fast follower" nations, such as Japan, who are
extremely adept at competing by learning from the first
movers' mistakes and improving on their processes. If we
are to compete, at all, in such a competitive environment,
some national strategy for introduction of new technologies
must be developed and employed. The test bed or incubator
concept is exactly how such a strategy will be realized.
INDUSTRIAL TECHNOLOGICAL INNOVATION
37
Managing technological innovation is the value-added
cybernetic strength upon which the US Army Corps of
Engineers will foster industrial-tactical crossover.
Innovation in construction functions, specifically hazardous
waste remediation, portends greater implications for
technological development and tactical application.
Peacetime innovation necessarily involves organizational
change. Technological innovation is strongly characterized
by the need to develop strategies for managing
uncertainty. 50 The cybernetic function of managing
technology for industrial application represents the dynamic
between the two and will help us think more holistically
about developing and using technology in general. It will
also help us understand the subtle yet powerful forces
driving innovation in the private sector for application at
the tactical level. As a result, we can develop strategies
and campaign plans for tactical technological innovation.
This is the essence of our operational art, that is, 1)
tying strategy with tactics and 2) creating the conditions
for quick and decisive tactical victory through, among other
things, doctrinal and technological superiority. Domestic
contractors are key in this regard to both the military (in
the new technologies they provide) and national
competitiveness abroad (in the strength of our national
38
technology base). Understanding this, we can balance our
tactical technological needs with our national technology
strategy. Consequently, the Corps' hazardous waste
remediation efforts have broader Army-wide implications for
understanding how we should innovate technologically
(physical domain of battle) and how we should manage it
(cybernetic domain).
39
Appendix A: DEFINITIONS"1
Administrative Record Compilation of documents that recordsthe decision making process regarding the selection of aresponse action to be taken at a site.
Applicable Requirements Cleanup Standards, standards ofcontrol and other substantive environmental protectionrequirements, criteria or limitations promulgated underFederal or State law that specifically addresz a hazardoussubstance, pollutant, contaminant, remedial action, locationor other circumstances at a CERCLA site.
Baseline Risk Assessment An evaluation of the potentialthreat to human health and the environment in the abscnce ofany remedial action at a site.
Bench Studies Treatability tests performed on a smallscale, usually in a laboratory, to better define parametersof a treatment technology.
Comprehensive Environmental Response, Compensation andLiability Act of 1980 (CERCLA) Also Superfund Amended in1986 by the Superfund Amendments and Reauthorization Act.
Competitive Evaluation Plan A plan which describes howtechnical proposals submitted by potential contractors willbe evaluate.
Contracting Officer Individual with the authority to enterinto, administer and/or :erminate contracts and make relateddeterminations and findings.
Contracting Officer's Representative Individual trained toprepare procurement requests and monitor contractorperformance. The Contracting Officer's Representative isnot authorized to sign contracts or to make changes andmodifications to a contract.
Data Quality Objectives Quantitative and qualitativestatements that specify the data needed to support decisionsregarding remedial response activities.
Decision Document Documentation of response actiondecisions for all actions at non-National Priorities List
40
Sites and for interim response actions at NationalPriorities List sites.
Defense Environmental Restoration Account A transferaccount, established by the Defense Appropriation Act of1984, that funds the Installation Restoration Program foractive installations and the Formerly Used Defense SitesProgram for formerly owned or used installations. Theaccount also funds the other goals of the DefenseEnvironmental Restoration Program.
Executing Agency The agency responsible for administeringIRP activities for a site or installation.
Major (military) Innovation A change in the concept ofoperation of [a] combat arm, that is, the ideas governingthe way it uses its forces to win a campaign . . . also [a]change in relation of that combat arm to other combat armsand a downgrading or abandoning of older concepts ofoperation and possibly of a formerly dominant weapon.Changes in the formal doctrine of a military organizationthat leave the essential workings of that organizationunaltered do not count as an innovation by thisdefinition.52
Potency Factor The lifetime cancer risk for each additionalmg/kg body weight per day of exposure.
Potentially Responsible Party -urrent and former owners oroperators and persons who may be accountable for havinggeneraLed hazardous substances or were involved intransport, treatment or have disposal of hazardoussubstances at a site under litigation.
Preliminpt7 Assessment Initial analysis of existinginformation to determine if a release may require additionalinvestigation or action.
Procurement Request Written justification for securingcontract services.
Project Officer Individual that develops the ProcurementRequest, in this thesis to be considered the same individualas the Contracting Officer's Representative.
Public Involvement and Response Plan Document based oncommunity interviews that specifies the community relations
41
activities that the Army expects to undertake during aresponse action.
Quality Assurance Project Plan (as stated in the NationalContingency Plan) A written document, associated withremedial site sampling activities, which presents inspecific terms the organization (where applicable),objectives, functional activities, and specific qualityassurance and quality control activities designed to achievethe data quality goals of a specific project or continuingoperations (or group of similar projects or continuingoperations). Part of the Sampling and Analysis Plan that isprepared prior to any non-emergency site samplingactivities.
Record of Decision Documentation of a final remedialresponse action decision at a National Priorities List site.
Reference Dose For a noncarcinogenic effects, the amount ofa chemical that can be taken into the body each day over alifetime without causing adverse effects.
Release (as stated in the CERCLA) Any spilling, leaking,pouring, emitting, emptying, discharging, injecting,escaping, leaching, dumping or disposing into theenvironment (including the abandonment or discarding cfbarrels, containers and other closed receptacles containingany hazardous substance or pollutant or contaminant), butexcludes (A) any release which results in exposure topersons solely within a workplace, with respect to a claimwhich such persons may assert against the employer or suchpersons, (B) emissions from the engine exhaust of a motorvehicle, rolling stock, aircraft, vessel, or pipelinepumping station engine, (C) release of sources, byproduct,or special nuclear material from a nuclear incident, asthose terms are defined in the Atomic Energy Act of 1954,if such release is subject to requirements with respect tofinancial protection established by the Nuclear RegulatoryCommission under Section 170 of such Act or, for the purposeof Section 104 of this title or aay other response action,any release of source byproduct, or special nuclear materialfrom any processing site designated under Section 102(a) (1)or 302(a) of the Uranium Mill Tailing Radiation Control Actof 1978, and (D) the normal application of fertilizer.
Relevant and Appropriate Requirements Cleanup standards,standards of control and other substantive environmental
42
protection requirements, criteria or limitations promulgatedunder Federal or State law, while not applicable to ahazardous substance, pollutant, contaminant, remedialaction, location or other circumstances at a site, addressproblems or situations sufficiently similar to thoseencountered at the site that their use is well suited to theparticular site.
Remedial Action or Remedy (as stated in CERCLA) Actionsconsistent with permanent remedy taken instead of or inaddition to removal actions in the event or a release orthreatened release of a hazardous substance into theenvironment, to prevent or minimize the release of hazardoussubstances so that they do not migrate to cause substantialdanger to present or future public health or welfare or theenvironment. The term includes, but is not limited to, suchactions at the location of the release as storage,confinement, perimeter protection using dikes, trenches, orditches, clay cover, neutralization, cleanup or releasedhazardous substances and associated contaminated materials,recycling or reuse, diversion, destruction, segregation ofreactive wastes, dredging or excavations, repair orreplacement of leaking containers, collection of leachateand runoff, on site treatment or incineration , provision ofalternative water supplies and any monitoring reasonablyrequired to assure that such actions protect the publichealth and welfare and the environment. The term includesthe costs of permanent relocation of residents andbusinesses and community facilities where the Presidentdetermines that, alone or in combination with othermeasures, such relocation is more cost effective than andenvironmentally preferable to the transportation, storage,treatment, destruction or secure disposition off site ofhazardous substances, or may otherwise be necessary toprotect the public health or welfare; the term includes offsite transport and off site storage, treatment, destruction,or secure disposition of hazardous substances and associatedcontaminated materials.
Remedial Action Process Identification, evaluation,decision making and design and construction steps requiredto implement control measures. The remedial action processmay lead to remedial actions, removals or decisions to takeno further action.
Remedial Design Technical analysis and procedures whichfollow the selection of remedy for a site and result in a
43
detailed set of plans and specifications for implementationof the remedial action.
Remedial Investigation Process undertaken to determine thenature and extent of the problem presented by a releasewhich emphasizes data collection and site characterization.The remedial investigation is generally performedconcurrently and in an interdependent fashion with thefeasibility study.
Removal (as stated in CERCLA) The cleanup or removal ofreleased hazardous substances from the environment, suchactions as may be necessary taken in the event of the threatof release of hazardous substances into the environment,such actions may be necessary to monitor, assess andevaluate the release or threat of release of hazardoussubstances, the disposal or removal material, or the takingof such other actions as may be necessary to prevent,minimize or mitigate damage to the public health or welfareor to the environment, which may otherwise result from arelease or threat of release. The term includes, inaddition without being limited to security fencing or othermeasures to limit access, provision of alternative watersupplies, temporary evacuation and housing of threatenedindividuals not otherwise provided for, action taken underSection 104(b) of this Act and any emergency assistancewhich may be provided under the Disaster Relief Act of 1974.
Response Action to remove, or undertake a removal, remedyor remedial action, including related enforcementactivities.
Sampling and Analysis Plan Document composed of a QualityAssurance Project Plan and Field Sampling Plan that isprepared prior to site sampling activities.
Site A location on an installation where hazardous wasteshave been stored, disposed, spilled or otherwise released tothe environment. A site includes land and water resourceswhere they are contaminated by the release, and it includesany structures, earth works or equipment that are clearlyassociated with the release. Where multiple sites maycontribute to contamination of an aquifer or a common landarea, the contaminated resource may be identified as a sitethat is distinguished from the sites where the releasesoccurred. A site is the basic unit for planning andimplementing response actions.
44
Sits Health and Safety Plan Document that specifiespolicies and procedures for ensuring the health and safetyof personnel working at a site.
Site Inspection On-site inspection to determine whetherthere is a release of potential release and the nature ofthe associated threats. The purpose is to augment the datacollected in the preliminary assessment and to generate, ifnecessary, sampling and other field data to determine iffurther action or investigation is appropriate.
Source Control Actions that either remove the source ofcontamination off-site or effectively contain it on-site sothat continuing releases are prevented or reduced.
Tactical innovation A change in the way individual weaponsare applied to the target and environment in battle.5 3
Technical Review Committee Committee composed of Army andEPA officials, State and local authorities and a publicrepresentative of the potentially affected community thatreviews and comments on response actions and proposedactions at Army sites on or proposed for the NationalPriorities List or other major sites (those that present asignificant threat to human health, welfare or theenvironment or cause public controversy).
Technological innovation Peacetime and wartimeorganizational innovation, is defined concerned with socialinnovation, with changing the way men and women inorganizations behave. Technological innovation is concernedwith building machines. Technological innovation introducesa new dimension to the relationship between one's own forcesand the military organization of the enemy, a qualitativetechnological one. It introduces a new set of domesticactors, scientists, into the community within which mii.tarydecisions are made. In short, technological innovation givesrise to an additional set of questions beyond thoseassociated with organizational innovation. 5 4
Technology Systematic knowledge and action, usually ofindustrial processes but applicable to any recurrentactivity. [It] is closely related to science andengineering. Science deals with humans' understanding of thereal world about them - the inherent properties of space,matter, energy, and their interactions. Engineering is theapplication of objective knowledge to the creation of plans,
45
designs, and means for achieving desired objectives.Technology deals with the tools and techniques for carryingout the plans."
Third Party Site Privately or municipally owned storage,treatment and disposal sites that received hazardous wasteseither from disposal contractors hired by the Army ordirectly from the Army. The Army, as a potentiallyresponsible party, is designated as the third party in caseswhere enforcement actions to recover costs of cleanup isinitiated. EPA, as the first party, cannot sue the Army torecover such costs, but nonfederal potentially responsibleparties, as the second party, can.
To Be Considered Requirements Non-promulgated advisories(such as reference doses or potency factors), criteria andguidance issued by Federal and State governments that areidentified to supplement applicable or relevant andappropriate requirements.
46
Appendix B: GLOSSARY5 6
AEO Army Environmental Office
ARARs Applicable or Relevant and AppropriateRequirements
CAA Clean Air Act
ADARS Army Defense Acquisition RegulationSupplement
CERCLA Comprehensive Environmental Response,Compensation, and Liability Act of 1980aka SUPERFUND
CFR Code of Federal Regulations
COE Corps of Engineers
DA Department of the Army
DASD(E) Deputy Assistant Secretary of Defense(Environment)
DEMIS Defense Environmental ManagementInformation System (replaces the DefenseEnvironmental Reporting System)
DERF Defense Environmental Restoration Fund
DERP Defense Environmental Restoration Program
DoD Department of Defense
DoE Department of Energy
EA Environmental Assessment
EIS Environmental Impact Statement
EPA The Environmental Protection Agency
47
FIFRA The Federal Insecticide, Fungicide, and
Rodenticide Act
FS Feasibility Study
FUDS Formerly Used Defense Sites
FWPCA The Federal Waster Pollution Control Actaka The Clean Water Act (CWA)
HM/HW Hazardous Material/Hazardous Waste
HRS Hazardous Ranking System
IAG Interagency Agreement
IG Inspector General
IR Installation Restoration
IRP Installation Restoration Program
NCP National Contingency Plan
NEPA National Environmental Policy Act
NFRAP No Further Respcnse Action is Planned
NPL National Priorities List
O&M Operations and Maintenance
OHW oLhor lazardous Waste
PA Preliminary Assessment
PA/SI Preliminary Assessment/Site Investigation
PRP Potentially Responsible Party
RA Remedial Action
RD Remedial Design
48
RD/RA Remedial Design/Remedial Action
RCRA Resource Conservation and Restoration Act
RI Remedial Investigation
RI/FS Remedial Investigation/Feasibility Study
RPM Remedial Project Manager
SARA Superfund Amendment and ReauthorizationAct
SDWA The Safe Drinking Water Act
SI Site Investigation
SSI Screening Site Inspection
TSCA The Toxic Substances Control Act
us United States
USA United States Army
USACE United States Army Corps of Engineers
USACE/MRD United States Army Corps of Engineers,Missouri Rivers Division
USATHAMA United States Army Toxic and HazardousMaterials Agency
UXO Unexploded Ordnance
49
Appendix C: STRATEGIC MARKET ANALYSIS
Commercial application of the remediation technologies
and treatment trains available cannot be successfully
effected without first understanding the structure of the
Hazardous Waste Management industry and the competitive
forces at work. This appendix to III. REMEDIATION
TECHNOLOGIES is based upon Michael E. Porter's Value-Added
Chain in Competitive Advantage (New York: The Free Press,
1985) and 1) presents a strategic market analysis of the
hazard waste remediation industry and 2) evaluates the Corps
potential roles in technological innovation for application
in this industry.
MARKET SEGMENTATION
The Hazardous Waste Management industry consists of
four (4) segments: 1) Laboratory Analysis, 2) Engineering,
3) Remediation, and 4) Treatment, Storage, and Disposal. In
the spectrum of Corps missions, Hazardous Waste Management
falls under Facilities Engineering/Management, where an
engineer and his staff maintain Army installations, from
energy production to trash disposal. The four (4) segments
are handled, in varying degrees, both at the installation
level and in engineering divisions and labs around the
world. As the world's largest purchaser of construction
services, the Corps plays an important role in domestic
50
construction. Consequently, the construction-oriented
remediation segment becomes particularly important.
The products and services provided by the Corps include
1) construction management, 2) engineeri-q and design,
3) laboratory support, 4) real estate development and
management, 5) emergency operations, and 6) regulatory
functions. Additionally, the Corps has various mobilization
and wartime missions that support not only US military
operations, but also secure and maintain the nation's
infrastructure.
The customers serviced by the Corps and its fleet of
contractors are 1) federal agencies, such as the Department
of Defense, the Department of the Army, and the
Environmental Protection Agency, 2) state governments, in
cost sharing scenarios, and 3) others, usually governments
of US Territories such as American Samoa. The most
important of these three (3) are the federal agencies,
specifically the Department of Defense, where base closures
and cleanup of aging installations are now top priorities
and promise to be Herculean tasks.
Construction Managemert, under either military or civil
works funding, is provided within the dictates of the
Federal Acquisition Regulation (FAR) and its Army and Corps
supplements. The primary mechanism for bringing completed
51
construction to the customer is the fixed price contract
secured through competitive, sealed bidding. All Corps
construction is performed under contract (the Corps has no
organic civilian construction assets.). Engineering and
design is performed either by in-house engineers or through
negotiated, open-end design contracts with regional and
local architect-engineer (AE) firms. Laboratory services
are accomplished at all of the Corps divisions and at the
three (3) Corps labs, as well as by private agencies
employed by contractors during construction. Real estate
development and management are functions which have been
developed through vertical integration alc ng the Corps Value
Chain and deal with Army or Defense Department lands.
Emergency operations are also provided at the Corps
divisions to assist the Federal Emergency Management Agency
(FEMA) with damage assessments and emergency construction
management during national emergencies and disasters
(hurricanes and earthquakes). Corps regulatory functions
pertain to the nation's waterways and are also performed at
all Corps divisions.
With regard to Hazardous Waste Remediation, the Corps
is providing construction management services for the
Defense Department ($1 billion budget for 1991 under the
Defense Environmental Restoration Program)"7 and the
52
Environmental Protection Agency under the Comprehensive
Environmental Response, Compensation and Liability Act
(Superfund).
Waste Remediation market trends ara very promising for
the short and medium term. Sinze 1980, government and
industry have spent between $5 and $10 billion on Superfund
cleanup projects alone. This represents only a fraction of
the ultimate amount, which will increase directly with the
number of federal regulations, toxins, and pub-ic anxieties.
The General Accounting Office estimates that over 425,000
sites may eventually require cleanup;"8 there are presently
1,236 sites identified on the Superfund National Priorities
List, only 54 of which have been permanently dealt with. 5 9
In the long term, hazardous waste remediation wiil give
way to more encompassing measures of waste management, where
producers will try to reduce their volumes of toxic output
through recycling and better housekeeping. 6" However, even
with significant environmental improvements in production
processes and scale economies in on-site waste treatment,
the nature and track record of Superfund suggest a bright
future for remediation services.
53
FIVE(5) COMPETITIVE FORCES
THREAT OF NEW ENTRANTS
ThI potential for significant financial gain makes this
industry segment especially attractive. Consequently, the
threat of new entrants is HIGH and will remain so for the
foreseeable future. With the enormous number of potential
sites and increasing estimates of cleanup costs, this threat
will continue to rise with time.
BARRIERS TO ENTRY
Barriers to entry are significant in this market
segment and mitigate the threat described above, but by no
means eliminate it. Regulatory uncertainties, management
inexperience, and lack of trained personnel (most important
for smaller firms) makp entry into waste remediation a
difficult task. 6" Additional barriers include significant
capital investments for remediation and testing equipment,
risks of future litigation (probably the most noteworthy of
a4,), inadequate or unavailable bonding, and the slow pace
of the Superfund program. Economic uncertainty (recession)
also looms as a real barrier for new entrants, especially
smaller firms. Along with capital investment, it poses a
formidable barrier to exit which firms must consider before
making the corporate leap into this segrment.
54
The remediation market is very consolidated for the
construction industry, with 70% of revenues now collected by
10% of companies. The percentage of revenues for these few
large firms is expected to rise in the next ten (10) years
as the industry continues to consolidate and rationalize the
inherent risks and potential benefits.62 Consequently,
potential entrants will be larger firms who are able to
muster the financial and technical muscle to capture new
contracts. A recent Corps initiative in decentralizing
procurement of remediation services has yet to change this
proposition. The hope is that with decentralized control
over remediation contracts, the Corps can involve more small
contractors and increase the number of participating
firms. Another possible threat might be posed by foreign
firms competing on a technological "fast follower" strategy,
much like Japanese firms who acquire or copy already proven
methods and apply them in more efficient ways to the
production process. When one also considers the significant
cost of capital advantage enjoyed by Japanese firms over
their American counterparts, this set of potential entrants
will represent a real threat, once new technologies are
developed. Finally, major construction firms not presently
competing in this segment are showing greater interest and
their presence is being increasingly felt. Also marshaling
55
their forces to penetrate the market are the waste
generators (big industry) themselves.°4
THREAT OF SUBSTITUTE PRODUCTS OR SERVICES
The threat of substitutes is LOW, primarily due to
specific guidance and tolerances in the federal regulations.
The threat, if 'here is one, is in new and different
remediation technologies. However, considering the barriers
to entry discussed above, the generally uncertain nature of
remediation, and our federal free market economic policies,
such a threat is not formidable at this time. Though many
firms are researching new remediation technologies, their
implementation will be guarded, at best; they will present
no challenge to proven practices until economic policies
change to nurture domestic technological growth.
BUYER/SUPPLIER POWER
Buyer power and supplier power are both HIGH. Buyers
of Corps (and their contractors) services brandish the
threat of litigation, demanding 100% quality assurances.
Suppliers of remediation services run the "only show in
town" at the present time and can extract significant
premiums, if not monopoly rents. The Corps may be immune to
some of this power, but its remediation contractors view the
influence as additional uncertainty to be programmed into
their risk premiums.
56
RIVALRY AMONG EXISTING FIRMS
Rivalry among the few large firms in this segILient is
HIGH, considering the expected future boom in remediation
work. However, with time, this rivalry will become more
widespread to include smaller, niche competitors championing
new remediation technologies. Additionally, as industry
experience becomes more widespread, both in the technical
and business areas, rivalry will jump accordingly.
VALUE-ADDED CHAIN
LINKAGES
From its long history as the government's construction
agent, the Corps enjoys significant linkages within its own
Value Chain, with the construction industry, and with other
industries. Solution mechanisms for the waste remediation
missions assigned by our federal civilian leadership are
well estabiished.
Within the framework of the Corps' remediation mission,
technology links construction operations with all other
Value Chain activities and is central to the global
development of this industry segment. New remediation
technologies are the key to improved competition and
efficiency which, in turn, impact Corps mission
accomplishment. A combination of new remediation
technologies and alternate procurement methods would reduce
57
the risks now experienced by contractors, encourage
innovation during construction, and generally feed new
information back into the construction system. The synergy
of information sharing in this way would increase contractor
proficiency and result in a better service for Corps
customers. Additionally, the Corps would act as a "testing
bed" for new processes and as a "farm system" of human
resource development for the industry.
MARKET IMPERFECTIONS
Imperfections in the present system deal primarily with
the inefficient allocation of risk between the Corps and its
contractors. This springs from the traditional procurement
methods currently in use and their inherent adversarial,
self-serving, and litigious nature.
If technological innovation drives true progress in
this market segment, then traditional procurement methods
are obviously inappropriate. To encourage technological
innovation, a more cooperative approach to contracting must
be employed. Alternative contracting methods will better
allocate risks between the contract parties and facilitate
more innovative approaches to remediation projects.
Biddability, constructability, and value engineering are
inherent in the process, resulting in better designs,
reduced delivery times, reduced costs, and improved service.
58
The obstacles to entry into this very important and
dynamic market should not be bureaucratic or procurement
based. In a risky business such as waste remediation, which
is so potentially vital to the nation and our technology
base, innovative management must guide the technological
innovations it seeks. Alternative contracting measures
cannot dispel the risks of litigation, reduce the costs of
American capital, or reconcile the short-term expectations
of financiers with the long-term aspirations of industry.
However, they can create an environment where innovation is
strategically, operationally, and economically feasible.
59
Appendix D: FURTHER RESEARCH REQUIRED
This appendix offers suggestions for further research
in this area. Specifically, two (2) topics are presented:
1) alternative contracting mechanisms for hazardous waste
remediation projects and 2) sophisticated project valuation
models for use with all US Army Cops of Engineers projects.
As discussed, the US Army Corps of Engineers, in
accordance with Superfund, SARA, the Defense Environmental
Restoration Program (DERP), and the Installation Restoration
Program (IRP), has become responsible for remediation and
closure of the hundreds of severely contaminated active
military installations and abandoned sites, along with bases
earmarked for closure. As DoD adapts to new missions and a
reduced strategic Soviet threat, environmental restoration
targets have become critical.
Several issues arise which are of import to remediation
efforts and, specifically, to the construction field.
First, as the government's construction agent, the Corps has
at its disposal several forms of contracting mechanisms, not
all of which equitably allocate operational or financial
risks among contract parties. Investigating how different
contracting mechanisms can be utilized to perform cleanups
while also reallocating risks more equitably would be of
considerable value. Second, the valuation of these projects
60
is normally not accomplished with more sophisticated
procedures, such as Valuation by Components (VC) or Option
Models (Black-Scholes). Investigating the value of
remediation projects with these methods would be an
important step toward a better understanding of their long
term, life cycle nature. Finally, justifying the Corps
taking responsibility for the Superfund cleanup program from
EPA would be of significant interest, specifically from a
construction management and environmental optimization view.
ALTERNATIVE CONTRACTING MECHANISMS
IMPORTANCE IN ADVANCING THE FIELD.
Understanding the risk shifting capacity of the
different contracting mechanisms available to the Corps
would be valuable to construction finance, and to the
government, in helping to develop strategies for financing,
valuing, and accomplishing risky projects. Specifically, if
quantified, the value of risk shifting in these instances
could be programmed back into the valuation mechanism and
appropriate contracting forms could be more efficiently
chosen to match the risk and the parties' abilities to bear
it. In the arena of technological innovation on remediation
projects, the record has been poor. Principle in this is a
lack of understanding, especially by Field Operating
Agencies (FOAs) of the Corps, of the magnitude of risk
61
associated with project-specific contracting wechanisms.
There is a general understanding that conventional
contracting mechanisms are adversarial and self-serving,
and alternative contracts can result in shorter performance
periods, reduced contract costs, and improved quality.
However, quantifying this and distilling it into a decision
calculus for developing contracting strategies is lacking.
With risk itself as a barrier to entry into this industry,
especially for smaller firms championing new technologies,
such an understanding is most important. Additionally,
pursuing such a research topic would help to develop project
Betas for environmental remediation jobs using different
contract mechanisms.
ANALYTICAL FRAMEWORK AND FORMAL PLAN.
The research plan would first identify the remediation
projects now being pursued by the Corps and the contracting
mechanisms used on each. I think we would want to
investigate why these contract forms were chosen,
specifically, whether it was organizational inertia or
precedent ("that's what we know and can do without thinking
too much about it"), dictated by regulation or statute, and
whether it was a conscious decision of the Contracting
Officer. It would be important to develop a "spread" of
contract types, forming a large enough representative
62
sample, so some comparisons could be drawn between them.
However, if only a few contracts were let by the Corps or if
all were of the same form, the investigation would
necessarily broaden to EPA work and projects in private
industry or at the state and local level. The next step
would be to try and group projects by risk category and size
to compare the contract dollar amounts across the several
contract types. With the fixed-price/competitive bid model
as our baseline or control, we could develop risk premiums
for each project and, correspondingly, contract type. From
this, knowing 1) the prevailing risk free rate, either
nationally or regionally, 2) something about how the
contractor had leveraged the project, and 3) something about
the portfolio of projects of that firm, or firms similar to
it, conclusions about the BETA for the specific project
could be developed. This could be extrapolated back to the
type of project and contract form used, establishing a base
of data (Betas) for such jobs. This database could be
subsequently used by the Corps to develop risk allocation
strategies for remediation projects. Such a program would
help Contracting Officers in developing programs for
equitably allocating the environmental, financial, and
operating risks of remediation jobs by assisting them in
63
matching the right contract form to the type of job and
contractor.
SOPHISTICATED VALUATION METHODS
IMPORTANCE IN ADVANCING THE FIELD.
The procedure normally employed by the Corps in valuing
construction contracts comes directly from manuals and
handbooks which outline the best estimated costs for
specific construction activities. Once an estimated
construction cost (ECC) is developed, a percentage for
profit and overhead are added, normally 15% total, and an
overall project value is developed. No project-specific
consideration is given to the financial values of time,
money, or risk. Consequently, the value of the project to
the contractor is overstated and the costs to the government
understated, from a long term, life cycle perspective. At
bid openings, contract award is based upon the lowest quoted
bid. If the government could value projects, and bids,
using VC or an Option Model, we would better understand the
premiums construction contractors place on flexibility and
uncertainty, along with the risks associated with specific
project types.
ANALYTICAL FRAMEWORK AND FORMAL PLAN.
There are thousands of construction contracts let by
the Corps each year. They range significantly in contract
64
amount, scope, and risk. Of these contracts, the
overwhelming predominance are fixed-price/competitive bid,
as already discussed. Emphasis on "cookbook valuation"
loses sight of the longer term value of jobs as well as the
value to contractors of leaving options open (flexibility).
A research program in this area would be directed at
determining the dollar amount by which the government is
overpaying, or underpaying, its contractors each year,
strictly from a financial analytical point of view.
Understanding that there are significant subsidies paid by
the government to firms for political reasons, the analysis
would hope to establish the difference between how the
government values and pays for services vis a vis how more
sophisticated valuation models say they should.
A number of contracts would be selected, grouped by
region, risk (degree of difficulty), dollar amount, and
period (year and month, so as to consider the periodic
variations in construction cycles). By group, each
contract, along with the bid abstract (listing the competing
contractors and their bids), would be evaluated. The spread
of bids on any given job would reveal a number of things,
such as, the contractor's need for work at the time of bid
opening, the risk associated with the quality of plans and
specifications, actual constructability risk, and how
65
contractors view the risks of dealing with the government.
Using a regression analysis technique, Contracting Officers
could establish individual risk premiums by type of jobs,
type of contract, and for their commands in general. This
information could be used as a mechanism for future cost
programming, where the government could direct resources to
reducing those sources of risk, as viewed by the
contractors. For the Corps' role in IRP and waste
minimization, a more sophisticated approach must be
investigated.
66
ENDNOTES
'Stephen Peter Rosen, Winning the Next War: Innovationand the Modern Military (Ithaca, NY: Cornell UniversityPress, 1991), 40.
2 Echoing the sentiments of B. R. Inman and Daniel F.Burton, Jr. in Technology and Competitiveness: The NewPolicy Frontier, Foreign Affairs, Spring 1990, 116-134.
3 Paul R. Fil, Major, US Army, An Analysis of theDepartment of the Army's Performance in Meeting itsObligations Regarding the Installation Restoration Program,MMAS Thesis, Command and General Staff College, FortLeavenworth, Kansas: 1992, 21.
4 Massachusetts Institute of Technology, Center forConstruction Research and Education, Global EnvironmentalTask Group, Presentation by Professor David Marks, Dean,Department of Civil Engineering (now Department of Civil andEnvironmental Engineering), 22 February 1991.
5 Ibid.
6 Rosen, 40.
'MIT Global Envirinmental Task Group, 22 February 1991.
' Low risk in the financial sense where the consequensesof failure are less severe, to the remediation contractorand the principle responsible party (the government) whencompared with a private site.
9 Bureau of National Affairs, Global Environmental Issuesand International Business: A Manager's Guide to Trends,Risks, and Opportunities, by Bradford S. Gentry, principalauthor (Washington, DC: 1990).
67
'01IT Global Environmental Task Group, 22 February 1991.
"William L. Robertson, To Be Environmental Engineers ForThe Nation, Strategic Working Paper #89-3, 11 April 1989, 4.
12A contracting mechanism where one (1) firm is awardedboth the design and construction of a project. Traditionalapproaches under the Federal Acquisition Regulation requiLecompetitive bidding on design and construction separately,award goinq to the lowest bidder. As the design firm andconstruction contractor are crne in the same, minimal timeand confusion are to be expected when transitir-ing fromconcept to execution.
"lA contacting mechanism similar to design-build. Thecontractor is given specifications to attain in a craddle tograve scenario. The term turnkey denotes contractor lead inall contract activities until the govenement is provided thekey to a cumpleted structure ':r final inspection.
" The adequacy of design documents (plans andspecifications) as a basis for construction, in this case,remediation processes. Deals primarily with the accuracy ofdesiign documents.
'i The adequacy of design documents (plans andspecifications) as a basis for contractor bids. Dealsprimarily with the precision (reproducable accuracy) ofdesign documents. High precision means less chance of costand time overruns, especially critical in high riskcontracts such as waste remediation. Consequently, suchprecision is crucial if small firms or innovatingcontractors are to secure the bonding required.
"16Massachusetts Institute of Technology, Center for
Construction Research and Education, Global EnvironmentalTask Group, Presentation by Professor John Ehrenfeld, 15March 1991.
17 Ibid.
68
18 Ibid.
"1 This point is presented to highlight that technologicalinnovation is not the only method for improved remediationresults, that is, there is no simple technology fix for thismost complicated and tenuous problem.
2 0 Rosen, 20.
21 US General Accounting Office, report to CongressionalRequesters, Hazardous Waste: DoD Efforts to Reduce Waste,GAO/NSIAD-89-35, February 1989, 2. Also, Michael Renner, inAssessing the Military's War on the Environment, State ofthe World 1991: A Worldwatch Institute Report on ProgressToward a Sustainable Society, 143.
22 Lenny Seigel, Gary Cohen, and Ben Goldman, The U. S.Military's Toxic Legacy: America's WorstEnrvironmental Enemy,The National Toxics Campaign Fund (January 1991), 1-2.
"23 The original National Toxics Campaign estimate (January1991) quoted a total of 14,401 "potentially contaminated"sites identified by the Defense Department. Since thattime, DoD has increased the number in an annual report toCongress to more than 17,000. These sites range from entirefiring complexes and production facilities to locationswhere only a few barrels of contaminants require disposal.(Source: Contamination report, Army vol 41 no 5 (May 1991),64).
"24 Siegel, et al, 3-4.
21 Ibid., 11.
26 Tbid., 3.
27 Ibid., 1.
69
"2 8 My personal experience in researching this topic led toa closed door at the Huntsville Engineer Division. When Iinquired about overall program goals and resalts, a well asspecific project information, I was routed to the PublicAffairs Office for a prepared statement. Specificinformation was denied me for national security reasons.
29 Conpartment refers to one (1) of six (6) parts of the
environment within which toxics and contaminants migrate andeventually contact humans. These compartments are 1) air,2) water, 3) land, 4) suspended solids in water, 5) bottomsediment in water, and 6) biota. Understanding how militarycontaminants migrate between and within compartments, basedon chemical mass balances, will help describe the dynamicand pervasive nature of the environmental problems that mayarise.
30 Siegel, et al. This report is replete with specificexamples where military toxics have migrated off theinstallation and contaminated civilian communities. Seepages 12, 14, 17, 28, 34, 43, 48, 57, 60, 75, dnd 80.
"Ibid., 24.
32 The specifics of this program are found in the US Army
Installation Restoration Program Guidance and Procedure(December 1990) prepared by the US Army Corps of EngineersToxic and Hazardous Materials Agency at Aberdeen ProvingGroundsm MD.
"33 Siegel, et al, 25-26.
"3 The federal government cannot be sued by individuals norstates. Consequently, DoD installations are immune fromprosecution.
70
35 DoD and EPA are both agents of the executive branch ofour government. The executive unity theory holds that theexecutive branch cannot sue itself, as the Justic Departmentworks for both DoD and EPA. Combined with the principle ofsovereign immunity, the federal governemnt is immune toprosecution from without and within.
"36 Siegel, et al, 38.
37 Rosen, 60.
38 Ibid., 64.
39 Ronald C. Sims, Soil Remediation Techniques atUncontrolled Hazardous Waste Sites: A Critical Review,Journal of the Air Waste Management Association, vol 40 no 5(May 1990): 706.
"40 Environmental Protection Agency, Office of Environmental
Engineering and Technology Demonstration, Guide to TreatmentTechnologies for Hazardous Wastes at Superfund Sites,EPA/540/2-89/052 (Washington, D. C.: March 1989), 1.
4' Ibid., 8.
42 Ibid., 11.
Ibid., 17.
44 Ibid., 17.
45 Sims, 706.
46 EPA/540/2-89/052: March 1989, 1.
71
47 Lawrence Susskind and Michael Elliot, Learning fromCitizen participation and Citizen Participation in WesternEurope, The Journal of Applied Behavioral Science vol 17 no4 (1981): 500.
"'Robertson, 4.
"' Ibid., 3.
50 Rosen, 52.
"5'Unless otherwise noted, all definitions are from Fil,1991, MMAS, 117.
s2Rosen, 7.
"Ibid., 7.
"s' Ibid., 40.
5sSybil P. Parker, ed., McGraw-Hill Concise Encyclopediaof Science and Technology (New York: McGraw-Hill BookCompany, 1984), s.v. Technology, by Harold B. Maynard andRobert S. Sherwood.
16 Fil, 113.
57 , DOD Reveals Cleanup Details, Engineer NewsRecord, 26 November 1990, 10.
58 Debra K. Rubin, Cleanup Dollars Flow Like Water ButIndustry Awash In Problems, Engineer News Record, 9 March1989, 30.
72
59 _ , Superfund Is Making Strides, But It StillHas A Dark Side, Engineer News Record, 26 November 1990,128.
"6 0David A. Hanson, Hazardous Waste Management: Planning To
Avoid Future Problems, C&EN, 31 July 1989, 14.
6•Rubin, 30.
"62 Hanson, 17.
63 DOD Reveals Cleanup Details, 10.
"Rubin, 36.
73
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79